Crawford v. Crawford

Couch, J., delivered the opinion of the Court. This case began in the Circuit Court for Baltimore County where the appellee, Robert John Crawford, filed a Bill of Complaint seeking a divorce a vinculo matrimonii founded on three years separation. The appellee also sought one-half of a jointly held savings account which consisted of the proceeds from a sale of the parties’ marital home after they had separated. Alice Alla Crawford, the appellant, by her answer to the Bill sought contribution from her husband for payments she made on the house mortgage, real estate taxes, and insurance.

We observe that the appellant lived in the house until it was sold. The chancellor, relying on the "presumption of gift” principle, which he found applicable and not rebutted by Mrs. Crawford, divided the savings account equally between the parties. This appeal ensued and we issued certiorari prior to consideration by the Court of Special Appeals in order to consider important questions pertaining to the presumption of gift doctrine as applied to the husband-wife relationship. The facts giving rise to this controversy are uncomplicated and to an extent uncontradicted.

After some ten years of marriage, during which they acquired a home and held it as tenants by the entireties, the parties separated in 1977 with ³⁰⁹ Mr. Crawford leaving the marital home and Mrs. Crawford staying in the house. He testified this was by agreement, with his further understanding that she would have all the responsibility for the house; this was denied by the wife. She also testified that she had requested Mr. Crawford to help pay some of the expenses and that she had no intention of making a gift to him. Mr. Crawford further testified they had agreed that when the house was sold the proceeds therefrom would be divided equally.

Again, this was refuted by Mrs. Crawford. What is certain, however, is the fact that during the period after separation and before the sale of the home, Mrs. Crawford paid the monthly mortgage note, the real estate taxes and insurance; it is for these items that Mrs. Crawford contends she is entitled to contribution from Mr. Crawford. In his written opinion the chancellor made no finding with respect to whether there was an agreement between the parties as Mr. Crawford testified. Rather he based his conclusion on holding (1) "that when one spouse uses funds for the purchase of property a presumption of gift arises in favor of the other spouse,” and (2) that Mrs. Crawford failed to rebut this presumption by clear and convincing evidence.

Thus the precise question for our consideration is whether the presumption of gift doctrine is applicable under the facts of this case. We shall hold that it is not. We begin our analysis by stating the general law of contribution that applies to co-tenants in the factual circumstances of this case. Generally, one co-tenant who pays the mortgage, taxes, and other carrying charges of jointly owned property is entitled to contribution from the other.

Aiello v. Aiello, 268 Md. 513, 518-19 , 302 A.2d 189, 192 (1973); Pino v. Clay, 251 Md. 454, 456-57 , 248 A.2d 101, 102-03 (1968); Hogan v. McMahon, 115 Md. 195, 201-02 , 80 A. 695, 698 (1911). This rule of contenancy applies equally to a tenancy by the entireties. We stated in Colburn v. Colburn, 265 Md. 468, 474-75 , 290 A.2d 480, 483-84 (1972), that "In Hogan , the plaintiff (appellant) filed a bill in equity seeking the sale of a parcel of ground which ³¹⁰ was held by the plaintiff and defendant as tenants in common. The defendant (appellee) filed an answer to the bill admitting its allegations, but denying that the plaintiff was entitled to relief for the reason that she had expended monies for improvements to the property, mortgage payments and taxes exceeding the amount claimed in the bill of complaint without any contribution from the plaintiff.

The plaintiff and defendant lived on the property until the plaintiff left of his own accord. There was no evidence that the defendant had ousted the plaintiff from possession. Upon these facts, the Court held: '* * * there can be no doubt that the appellee is entitled to contribution by the appellant for liens and encumbrances paid by her since they became tenants in common. 17 Am. and Eng. Ency. of Law, 685; 7 Ibid. 353, and, as shown by the last cited authority, that statement includes mortgages, taxes and ground rent.

See also Pino v. Clay, 251 Md. 454, 456-457 , 248 A.2d 101 (1968); Withers v. Douglas, 206 Md. 141, 148 , 110 A.2d 513 (1955); Schilback v. Schilback [sic], 171 Md. 405, 408 , 189 A. 432 (1937); and Myers v. Loan & Sav. Assn., 139 Md. 607, 612 , 116 A. 453 (1922). Schilback [sic], supra, makes it clear that the rule of law applied in Hogan is . equally applicable to tenants by the entireties.” Schilbach stated that "A tenancy by the entireties is essentially a joint tenancy, modified by the common law theory that the husband and wife are one person .... Except for the fact that it cannot be defeated, during their lives, without the joint action of both, the same rules of law apply to it as to any other cotenancy.” 171 Md. at 407-08 , 189 A. at 433-34 (citation omitted). ³¹¹ Therefore, a co-tenant in a tenancy by the entireties is entitled, to the same extent as a co-tenant in a tenancy in common or joint tenancy is entitled, to contribution for that spouse’s payment of the carrying charges which preserve the property.

Thus, Mrs. Crawford would be entitled to deduct these expenses from the proceeds of sale before splitting them between the parties. When the co-tenants are married to each other, however, a presumption of gift usually arises as to any payment made to purchase the property, Anderson v. Anderson, 215 Md. 483, 488-89 , 138 A.2d 880, 883 (1958); Reed v. Reed, 109 Md. 690, 692-93 , 72 A. 414, 415 (1909); to improve the property, Klavens v. Klavens, 275 Md. 423, 431 , 341 A.2d 411, 416 (1975); or to preserve the property, Lingo v. Lingo, 267 Md. 707 , 299 A.2d 11 (1973); Colburn v. Colburn, 265 Md. 468, 475-76 , 290 A.2d 480, 484 (1972). In Klavens , a husband, after divorce, sought reimbursement from the proceeds of sale of the parties’ home, which was held as tenants by the entireties, for a loan to which he had individually obligated himself while the parties were living together as husband and wife. Although the loan was not secured by a lien on the property, the proceeds were used in the construction of a dwelling on it.

We stated that "the general rule [is] that advancements and payments by one spouse toward the purchase — or, as here, the improvement — of property owned as tenants by the entireties are presumed to be a gift to the other spouse to the extent of the latter’s interest in the property.” 275 Md. at 431 , 341 A.2d at 416 . "[T]he question of whether a purported gift by one spouse to another is made with donative intent turns on the facts and circumstances prevailing at that particular time.” 275 Md. at 432 , 341 A.2d at 416 . We also held that the presumption, when it applies, must be overcome by clear and convincing evidence. Id.

We hold today that this presumption arises only when the parties are living together as husband and wife. When they are not, even though they may be legally married, the reason for the presumption, that married couples usually contribute their physical, emotional, and financial efforts for their ³¹² mutual benefit, obviously does not apply. While neither Klavens nor our previously decided cases in this area explicitly set forth this principle, they are consistent with it. Our holding today is